TaxTMI 
TaxTMI 
2013 (5) TMI 296
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.... created with an objective of forming a patent pool for medicines. Tenofovir (TDF), emtricitabine (FTC), cobicistat (COBI), elvitegravir (EVG) and a combination of these four products called 'Quad' are Antiretroviral (ARV) drugs used for treatment of HIV infection. The Active Pharmaceutical Ingredient (API) is the raw material used for production of drugs. The informant submitted that the OP was presently manufacturing TDF and FTC in USA and other countries whereas EVG, COBI and Quad are in the development stage and yet to be approved for use in HIV treatment. 3. The informant stated that as per WHO data globally by the end of 2009, the number of people living with HIV was around 33.3 million. The National AIDS Control Organisation, India (NACO) in its annual report 2010-11 stated that India had the third largest number of people living with HIV/AIDS. 4. The treatment for HIV infection is known as Antiretroviral Therapy (ART) and is to be taken life-long. The treatment prolongs and extends the life of the person affected by 20 to 25 years and improves the quality of life. The treatment is segmented into three levels: first line, second line and third line. The first line trea....
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....% and 5% for different drugs and their combinations. It was mentioned by the informant that the OP made two product patent applications i.e. in 1997 for TDF and in 2004 for TDF and its compositions, at Indian Patent Office which were vehemently opposed by Indian pharmaceutical companies. 8. The informant stated that the OP wrongly claimed in the appendix to LA-2011 that it had been granted patents i.e. 2174/DEL/98 and 01316/CHENP/2004 whereas the website of Indian Patent Office showed that the former application was not yet published and the latter did not exist. The informant alleged that the appendix neither stated that the application was with respect to a process or a product or a divisional application nor did it state that the product patent application was rejected. 9. The informant pleaded the following three types of agreements were in contravention of the provisions of the Act: (a) Voluntary non-exclusive agreements entered into by the OP directly with Indian Pharmaceutical companies since 2006 for production and distribution of TDF and FTC medicines and their combinations. (b) Licence agreement of the OP with ....
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.... to purchase API for the drugs in question and their combinations within the territory from the OP and its licensed distributors and agents only. (i) Patent pooling was a restrictive practice as it locked the technology and production in a few hands by entering into agreements to pool patents, thereby making it difficult for those companies outside the pool to compete. (j) The license agreements entailed unreasonable conditions on non-patented drugs, restricted competition in the market by dividing the markets among pharmaceutical companies that would otherwise compete using different technologies. (k) The license agreements that the licensees were to enter into with the re-sellers were also to be scrutinised and approved by the OP and the agreements could be terminated at the behest of the OP. (l) The license agreements limited the innovation and technical development of Indian pharmaceutical companies as these agreements provided for one time know-how transfer from the OP to Indian pharmaceutical companies and the OP had no obligation to reveal any kind of improvements ....
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....O informed the Commission that in the treatment, one pill containing minimum three ARV drugs combination is given to a patient. The ART was a combination of the following inhibitors: Nucleoside Reverse Transcriptase Inhibitors (NRTI), Non-Nucleoside Reverse Transcriptase Inhibitors (NNRTI), Protease Inhibitors (PI) and Fusion Inhibitors(FI). The first line ART regimen followed in India consisted of Zidovudine/Lamivudine/Nevirapine or Stavudine (Tenofovir)/Lamivudine/Nevirapine. The second line ART regimen followed in India consisted of TDF (Tenofovir) (300mg) + 3TC (Lamivudine) (300mg) in fixed dose combination or ATV/r (Cap. Atazanavir 300mg. + tab. Ritonavir 100mg). The Indian market for ARV drugs was dominated by generic products manufactured by Indian pharmaceutical companies. From the presentations, it was gathered that there are 12 Indian companies who manufactured WHO pre-qualified ARV drugs and approximately 9 foreign companies also manufactured WHO prequalified ARV drugs. 14. It was further stated that NACO procured ARV drugs for around Rs. 300-500 crore annually for its national AIDS control programme. The top four Indian companies manufacturing ARV drugs were Cipla (5....
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....ement of the provisions of the Act. The second agreement was between the OP and MPP i.e. LA-2011 which allowed MPP to sub-license the manufacture and sale of the drugs to Indian pharmaceutical companies. This agreement will not fall within the ambit of section 3(4) of the Act since MPP is nowhere in the production chain. The last agreement i.e. the tripartite agreement falls within the contours of section 3(4) of the Act vis-à-vis the OP and the Indian pharmaceutical companies who are placed in different stages of the production chain and therefore, appreciable adverse effect on competition needs to be examined keeping in view the factors in section 19(3) of the Act. 18. Section 19(3) of the Act which lists the factors to be considered for appreciable adverse effect on competition reads as under: "(3) The Commission shall, while determining whether an agreement has an appreciable adverse effect on competition under section 3, have due regard to all or any of the following factors, namely:- (a) creation of barriers to new entrants in the market; (b) driving existing competitors out of the m....
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.... Regimen I Zidovudine + Lamivudine + Nevirapine Preferred regimen for patients with Hb >9 gm/dl Regimen I(a) Tenofovir + Lamivudine + Nevirapine For patients with Hb < 9gm/dl Regimen II Zidovudine + Lamivudine + Efavirenz Preferred for patients on anti-tuberculosis treatment, if Hb > 9 gm/dl Regimen II (a) Tenofovir + Lamivudine + Efavirenz For patients on anti-tuberculosis treatment and Hb < 9 gm/dl The Second line ARV Regimen Drugs are as under:- Second Line ARV Drugs Second Line ARVs Dosage Dosing schedule TDF + 3TC Fixed dose combination of TDF 300 mg + 3TC 300 mg 0-0-1 (One tablet in the night) ATV/r Cap. Atazanavir 300 mg 0-0-1 (One capsule in the night) Tab Ritonavir 100 mg 0-0-1 (One tablet in the night) TDF: Tenofovir; 3TC: Lamivudine; ATV/r: Ritonavir boosted Atazanavir 21. Presently, a vast majority of people in low and middle income countries are being provided generic ARV drugs produced by Indian manufacturers unhampered by patent and other intellectual property restrictions. The Patent Act, 1970 was amended by India in 2005 to al....
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....tered into the territory of third line treatment as presently no patient has reached the stage where third line treatment may be required to be prescribed and it restricts itself more to the first line treatment with very few patients being given second line treatment. Even if the contention of the informant is accepted that the license agreements were anti-competitive, still there would be no appreciable adverse effect on competition since only the private practitioners who recommend the drugs in question, and cater only to a miniscule number of patients as compared to the national AIDS control programme. Therefore, in the opinion of the Commission, no appreciable adverse effect on competition would be there due to the alleged agreements and no contravention under section 3(4) of the Act was made out. 24. As abuse of dominance was also alleged, the applicability of section 4 of the Act was examined. It was noted that the informant discussed five ARV drugs namely TDF, FTC, EVG, COBI and Quad and their availability in the market, however, it was learnt that there were many other drugs present in the market including Zidovudine, Lamivudine, Nevirapine, Indinavir, Nelfinavir etc. I....